How to Validate Your Crowdfunding Idea

30 July 2015

When it comes to crowdfunding, the crowd is your jury, and they have the sole power to rule for or against your idea with their dollars. A successfully backed project represents an idea that’s solid, resonates with the market, and is worthy of bringing to fruition. With this comes the idea that crowdfunding is the ultimate means for creators to validate an idea before investing too heavily in building something nobody wants. Although this is true, there’s more to it. To get a fair trial, your idea needs to be proven and invested in long before judgement day.

In this chapter, we’ll share how to turn your “aha” moment into a project idea that’s tight, validated, and has the potential to kill it with the crowds.

STEP 1

Pitch and Gauge

Start small. Share your idea with friends, family, and just about anyone who will listen. Take note of reactions, questions being asked, and which parts of your project idea are and aren’t resonating. The feedback from this small sampling should offer the insight you need to dive in further, and begin researching. The end goal of this research: a business plan that details the viability of your project and a succinct pitch. For those who aren’t seeking investment nor plan on building a long-term business, developing a business plan may seem over-the-top. However, the process of creating a plan will force you to research with direction, answer difficult questions about your idea, and help figure out your audience.

Similar to developing a business plan, a pitch too, may seem unnecessary. This couldn’t be further from the truth. A pitch--better yet a 60 second elevator pitch--is the boiled down version of your business plan and should pack persuasive punch.

Your pitch should:

Be short and sweet. Less is more.

Be centered around the problem you’re solving and why you have a solution (for creative projects the problem may be less tangible, but it’s still there!).

Address potential objections to your idea.

Share why your idea is original, and better than the existing competition. Why is it unique?

Present facts not fiction. Prove out your hypotheses where you can, but don’t sell unicorns and pixie dust.

Once your pitch is tight, bite the bullet and present at hardware meetups, startup and community events. The more feedback you get, the more you’ll learn about how to best build and sell your crowdfunding idea.

STEP 2

Find a Mentor.

When we asked Lisa Fetterman, the founder of Nomiku (who successfully crowdfunded $1.3M) what advice she would give to early-stage entrepreneurs developing their idea, she said “find a mentor as soon as possible that’s in your field.” Having an expert hop on your bandwagon is not only a massive indicator that you’re onto something, it will help strengthen your idea and guide you throughout the various stages leading up to your crowdfund. Mentorship can be especially effective when seeking investment. Investors and contributors love seeing that other like-minded and notable people are on-board with your idea.

It can take a while to connect with the right mentors for your project. The best way to meet these beacons of knowledge are by attending as many networking events (related to your project) as possible. Eventually, the right mentor will be excited by your pitch and one coffee date later, you could be set with the guidance that’ll take your idea to the next level, and save you from making some painful mistakes. Alternatively, you don’t need to be restricted by geography. A great place to find temporary mentorship are in crowdfunding groups on Linkedin, Facebook or Reddit.

A mentor--or better yet, group of mentors--will not only be enormously helpful in the ideation phase, but will prove to be critical further down the road as you sort out the moving parts of your crowdfund.

STEP 3 (Optional)

Apply to an Accelerator Program.

Although not every successful crowdfunding campaign is the graduate of an accelerator or incubator program, those who are are often in a league of their own. The reason: accelerator programs give makers unprecedented access to top-of-the-line resources, mentorship, advice from colleagues, and help dot the i’s and cross the t’s with things like incorporating, finding manufacturing partners etc. This isn’t to mention the funding graduates receive in order to accelerate prototyping and get crowdfunding-ready, faster.

For this reason, acceptance into these programs can be extremely competitive. If nothing else, like building a business plan, the application process to get into these programs is a great exercise to better understanding your project. If you get into a top program, that’s the greatest validation you could ask for.

Here is an excellent listing of accelerator programs around the world put together by Postscapes. Another great starting point for College or University students and alumni are directly through the institutions themselves. It’s becoming increasingly popular for schools to offer their students accelerator and mentorship programs to assist with business cultivation. This is especially true when it comes to software or hardware ideas.

STEP 4

Build a Landing Page

Once you’re confident that your crowdfunding idea has some weight to it, it’s time to build a landing page. A landing page will accelerate feedback, gauge market fit, and help you understand who your audience is. As you begin the lengthy process of building out your idea and preparing for your crowdfund, the landing page will serve as home base, collecting customer leads as you go.

For example, Prynt who launched on Kickstarter in January of 2015 raising $1,576,011, set-up their landing page four months prior in September of 2014.

Here’s what Prynt’s landing page looked like:

Similarly, Boosted Boards who launched on Kickstarter in September of 2012 raising $467,167, set-up their landing page four months prior in May of that year.

Here’s what their landing page looked like:

Setting up a landing page at least a few months prior to launching is especially important for DIY independent crowdfunders. This way, proper marketing tactics, media outreach, paid ads, and supporting content can be established to ensure discovery and mindshare are in place when it’s time to hit the crowds.

Here’s what your landing page should have going for it:

Simplicity. Don’t over-complicate things.

Branded imagery/tagline.

A single call-to-action collecting emails. These are the hot leads you’ll groom prior to launching and will call upon in the first 24 hours of your launch.

Zero outside links. Make your call-to-action the only action visitors can make.

STEP 5

Make Something.

Building a working prototype or materializing your project idea is a topic we’ll dive into next week (click here to subscribe to our newsletter so we can let you know when the next part in this series is available). However, it’s also an important, final stage, for idea validation. Without a prototype for users to engage with, your idea can only be validated in theory. This is something that Sanjay Dastoor of Boosted Boards underscored in a recent interview with us, when asked about the process of validating their electronic longboard. His advice to budding entrepreneurs (passed on by their mentors from Y Combinator): “Get real feedback as early as possible.” As the founder explained, this meant “figuring out how to design a simple version of the board that could get in the hands of customers soon.”

Getting an early version of soon-to-be crowdfunded project out in the world is huge for your progression. A visualization of your vision is key for attracting customers, as well as getting better mentors, better feedback, and better manufacturing partners. For Boosted Boards, bootstrapping an early version of their longboard helped lockdown key players that would help take the board to the next level. It also sealed the deal that they were onto building something major.

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